Sunday, August 9, 2009

American energy policy is in limbo. “Drill, baby, drill” still articulates a good policy direction, but the Obama administration is outsourcing that policy, and our tax dollars, to Brazil. This is all while the White House is ignoring public opinion by blocking domestic energy production. The mind boggles when trying to figure out why the energy issue is still at issue at all.

A year ago today, House Republicans were nearing the end of their second week of a “rump” session in a darkened House chamber, garnering huge public support as they protested the Democrats’ refusal to allow a vote for more domestic drilling. The month before, the George W. Bush administration had lifted an 18-year executive order forbidding energy production off most of the American coast. However, a congressional ban remained in effect, and Americans angry about high gas prices rightly were demanding that the ban be lifted.

The anger dissipated when the old congressional ban expired without a vote, leading the public to think energy development would soon begin. The public didn’t count on the Obama administration’s radical environmentalism getting in the way. A July 10 letter to the president organized by a group called the Institute for Energy Research explains what has happened since:

“In February, barely two weeks on the job as our nation’s new Interior secretary, Ken Salazar rescinded 77 already-awarded leases on 130,000 acres of energy-rich land in Utah …. That same month, Mr. Salazar shut down an oil shale leasing program that had begun to make serious strides toward more cleanly and efficiently producing American oil from shale — a potential recoverable resource three times the size of Saudi Arabia’s oil supplies. And finally, the secretary announced that a new offshore energy plan — written in the months after Congress allowed its offshore ban to expire — would have to wait an additional six months before his department would even consider looking at it again …. Taken separately, each of these events has cost the American people millions of units of usable energy, and potentially billions of dollars in lost wages, revenues and royalties.”

The 21 signers of that letter, representing think tanks and industry groups, are right on the money. Today’s gas prices of about $2.51 a gallon — absurdly high compared to the August 2002 average of $1.36 — will become substantially higher still if and when the current recession ends. Clearly, the Obama administration’s hostility against domestic production, and the high prices caused by administration policies, would have Americans up in arms if so many other problems with Obama economic policies were not already causing greater angst from coast to coast.

But here’s the kicker: While the administration blocks domestic development that would benefit Americans, it is funding overseas energy development that will profit foreign countries. EFE News Services, the largest Spanish-language news outfit in the world, reported on Aug. 5 that “the U.S. government is prepared to provide up to $10 billion in loans to finance the development of massive hydrocarbon reserves off Brazil’s coast …. The U.S. Export-Import Bank already has signed a letter of intent in that regard with Brazilian state oil company Petrobras.”

The administration is using American tax money to guarantee a loan so Brazil’s national oil company can drill off its coast but is blocking American companies from drilling safely off the coasts of states that want the development. That energy policy, which bizarrely favors foreign interests at the expense of American production, will go about as far as an empty gas tank.

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